Corn Products Updates NAFTA Proceedings
Tribunal awarded damages to the Company in the amount of $58.386 million, representing lost profits in Mexico as a result of the tax and certain out-of-pocket expenses incurred by CPIngredientes, together with accrued interest.
20 Aug 2009 On October 21, 2003, Corn Products International, Inc. submitted, on its own behalf and on behalf of its Mexican affiliate, CPIngredientes, S.A. de C.V., a Request for Institution of Arbitration Proceedings (the "Request") against Mexico pursuant to Chapter 11 of the North American Free Trade Agreement ("NAFTA"). In the Request, the Company asserted that the imposition by Mexico of a discriminatory tax on beverages containing HFCS breached various obligations of Mexico under the investment protection provisions of NAFTA.
The case was bifurcated into two phases, liability and damages, and a hearing on liability was held in July 2006. In a Decision dated January 15, 2008, the Tribunal unanimously held that Mexico had violated NAFTA Article 1102, National Treatment, by treating beverages sweetened with HFCS produced by foreign companies differently than those sweetened with domestic sugar. In July 2008, a hearing regarding the quantum of damages was held before the same Tribunal. Post-hearing submissions on specific topics relative to the damages claims were filed on October 31, 2008.
In an award rendered August 18, 2009, the Tribunal awarded damages to the Company in the amount of $58.386 million, representing lost profits in Mexico as a result of the tax and certain out-of-pocket expenses incurred by CPIngredientes, together with accrued interest. It is not known at this time whether any of the parties will seek to set aside the award or pursue other available rights under applicable law.
